Why doesn't undskyld work?
"De er undskyld" would roughly translate to "They are excuse me". It just doesn't make sense in this context.
Is ked/kede ever used without the "af det"?
I'm asking as well.
I think "they are sorry" is the wrong translation.
See http://ordnet.dk/ddo/ordbog and enter "ked"
There it says "ked af det" means "ulykkelig eller nedtrykt". So I think "They are unhappy" would be a better translation.